The Equity Compensation Guidebook

What is a Nonqualified Stock Option, Ep 20


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Welcome to the  Equity Compensation Guidebook and episode 3 of our mini-series. Today I will break down precisely what a non-qualified stock option— commonly referred to as an NSO— is. I won’t be covering incentive stock options since 95% of stock options are non-qualified and I don't work with any clients who have ISO's. If I tried to explain the ISO I'm sure it would be a mess since I don't cater to those clients. NSOs are not super complex. The complexity with NSOs comes into play when you exercise the options and while we'll touch briefly on that, I'm going to save that minutia for another episode.

You will want to hear this episode if you are interested in...
  • What is an NSO? [1:19]
  • Important time periods when it comes to NSOs [2:49]
  • When to exercise and how to pay for your options [4:05]
  • What to expect when it comes to taxes [6:16]
  • This week’s FLASHBACK [7:28] 
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The Equity Compensation GuidebookBy Daniel Johnson